Which Finance career pathway includes helping people create and manage budgets and calculate taxes?

At the beginning of 2021, VHF Industries acquired a machine with a fair value of $4,803,660 by issuing a three-year, noninterest

Serga [27]

Answer:

a. What is the effective rate of interest implicit in the agreement?

I used an Excel spreadsheet and the RATE function:

PV = 4,803,660

FV = 6,000,000 (optional)

Nper = 3

Payment = -2,000,000

Rate = 12%

b. Prepare the necessary journal entry.

Dr Machinery 4,803,660

Dr Discount on notes payable 1,196,340

Cr Notes payable 6,000,000

c. Suppose the market value of the equipment was unknown at the time of purchase, but the market rate of interest for notes of similar risk was 11%. Prepare the journal entry to record the purchase of the equipment.

we would need to determine the present value, again using an Excel spreadsheet and the PV function:

PV = $4,887,429.43 ≈ $4,887,429

Dr Machinery 4,887,429

Dr Discount on notes payable 1,112,571

Cr Notes payable 6,000,000

8 0

3 years ago

Micro, Inc., started the year with net fixed assets of $75,300. At the end of the year, there was $96,700 in the same account, a

Pie

Answer:

$158,730

Explanation:

Mario incoporation started the year with a net fixed assets of $75,300

At the end of the year the net fixed assets was $96,700

The depreciation expense is $13,270

Therefore the company's net capital spending for the year can be calculated as follows

= $96,700+$75,300-$13,270

= $172,000 - $13,270

= $158,730

Hence the company's net capital spending for the year is $158,730

6 0

3 years ago

Pls, the meaning of warranty

kenny6666 [7]

Answer:

A warranty is a written promise by a company that, if you find a fault in something they have sold you within a certain time, they will repair it or replace it free of charge.

6 0

2 years ago

The first step in the process of creating a marketing plan is to

Maksim231197 [3]

The right answer for the question that is being asked and shown above is that: "• set marketing objectives." The first step in the process of creating a marketing plan is to <span>set marketing objectives. The group must know the goals and objectives why they are making a business or something.</span>

7 0

3 years ago

Targaryen Corporation has a target capital structure of 75 percent common stock, 10 percent preferred stock, and 15 percent debt

erastova [34]

Answer:

a.

WACC = 0.07961 or 7.961% rounded off to 7.96%

b.

After tax cost of debt = 0.0474 or 4.74%

Explanation:

a.

The weighted average cost of capital or WACC is the cost of a firm's capital structure. To calculate the WACC, we multiply the weight of each component of the capital structure by the cost of that component. The components of capital structure can be one or all of the following namely debt, preferred stock and common stock.

The formula for WACC is,

WACC = wD * rD * (1-tax rate) + wP * rP + wE * rE

Where,

w represents the weight of each component

r represents the cost of each component

D, P and E represents debt, preferred stock and common stock respectively

WACC = 0.15 * 0.06 * (1 - 0.21) + 0.1 * 0.05 + 0.75 * 0.09

WACC = 0.07961 or 7.961% rounded off to 7.96%

b.

The after tax cost of debt is calculated by multiplying the cost of debt by (1 - tax rate) to adjust for the tax advantage provided by debt as interest payments on debt are tax deductible.

After tax cost of debt = 0.06 * (1 - 0.21)

After tax cost of debt = 0.0474 or 4.74%

7 0

3 years ago